Sales of new vehicles in metro Birmingham rose 9 percent in March compared to February, the first month-to-month increase in six months, fueling hopes that the auto sales slump has hit a bottom.

Brett McBrayer, president of the Birmingham Auto Dealers Association, said a survey also showed that sales of used vehicles in the area climbed 13 percent in March from the previous month. And in another positive sign, some area dealers are reporting higher foot traffic and phone inquiries from consumers.

"We certainly believe we've hit a bottom and that consumers are coming in as they find credit is still available and respond to the great deals available out there," McBrayer said Wednesday.

Jimmy Skinner Jr., vice president of Jim Skinner Ford, said his dealership on Roebuck Parkway in Birmingham has seen a positive response to special deals that include 0 percent financing and factory incentives on some 2009 models.

Its top-selling F-150 pickup truck now comes with a $4,000 rebate on vehicles financed through Ford Motor Credit and a $3,000 rebate on those financed through other lenders.

Limbaugh Toyota in Ensley also has 0 percent interest and $5,000 rebates on some models, owner Bruce Limbaugh said Wednesday. He said car dealers are encouraged as the peak spring and summer car-buying season is under way.

"Wachovia has stepped up their lending, as have credit unions like America's First and Legacy," Limbaugh said. "As people are finding out financing is still available, more are coming out to buy."

Yet another positive: A federal tax break on new car purchases retroactive to Feb. 16, approved by Congress last month. The Internal Revenue Service said anyone who buys a new vehicle by Jan. 1, 2010, can qualify for a tax deduction.

The deduction is limited to state and local sales and excise taxes paid on a new cars, light trucks, motor homes or motorcycles costing up to $49,500. New vehicles buyers can take the deduction without having to itemize when they file their tax returns next year, IRS spokesman Dan Boone said.

Limbaugh said the federal tax break should entice more buyers to shop. On a Camry sedan costing $20,000, for example, local and state taxes can add up to $950, he said. "That's great news," he said.

Dealers in the Birmingham area and across the nation has had to cope with the worst industry downturn in decades. Automakers such as GM and Toyota have reported steep monthly declines in U.S. sales since the recession began, and some dealerships have closed.

The March sales survey showed the first sales gain for Birmingham area auto dealers since September 2008. The survey was prepared by Experian, the big credit reporting firm.

McBrayer wouldn't release total sales figures for March or say how sales last month compared to the previous March.

He said Toyota, which replaced longtime leader Ford a year ago, remained the top selling brand in March, accounting for 15.6 percent of new car sales, followed by Ford with 13.8 percent. The rest of the Top 10 brands last month were Honda, Chevrolet, Nissan, Dodge, Lexus, Jeep, GMC and Mazda.

E-mail: rwilliams@bhamnews.com